How secure is investing in property through crowdfunding platforms
Buy to let vs SPV
December 11, 2019
How will the election affect the UK house market?
December 15, 2019Property crowdfunding is a form of equity crowdfunding.
It is usually a long term investment where you do own the property except you only have a small share of it. Whilst investing in property can be considered a safe investment due to the fact it is backed by a tangible asset, it is not without risks. These include loss of capital and income from property investment is not guaranteed.
Investment in property comes with risks as well as the possibility of rewards. These investments should be considered to be long term investments as it may not be possible for you to get your capital back before the term expires and you could suffer loss of capital. The value of the property can go down as well as up and such fluctuations will affect the amount of capital you receive back at the end of the term of the investment. Any regular payments offered may also be affected by factors such as the market rental value, periods of non-occupancy and unforeseen refurbishments.
The beauty of property crowdfunding is that its 100% hands off. The crowdfunding platform takes care of everything or more accurately they employ a managing agent who takes care of everything.
Ways Crowdfunding companies keeping you safe
The first thing to say about property crowdfunding is nobody knows exactly what they will be. That’s the nature of equity investments, the platform will give their best guess about what the outcome will be, but it’s impossible to predict the future with total accuracy.
- SSL Technology
- SSL stands for Secure Sockets Layer. It is a security technology that’s enabled when an encrypted link is established between a web
server and a browser. In other words, by establishing an SSL connection, the Crowdfunding Platform can ensure that the transmission
of a consumer’s personal data is encrypted and private.
- PCI (Payment Card Industry) Compliance
- Set of security standards designed to ensure that all companies that accept, store, process, or transmit credit card information maintain a highly secure environment.
- Trust and Safety Departments
-
Are the crowdfunding community’s protectors and are there to ensure the crowdfunding platform is safe for everyone. These teams are responsible for inventing and advancing technologies to keep people safe, as well as preventing any possible crowdfunding scams and fraud. It is important to always use a crowdfunding website that has a devoted trust and safety team.
- Guaranteed Refund in Rare Cases of Misuse
-
Offering a refund is another way for a crowdfunding platform to show their community that they go the extra mile. A reliable platform will provide donors and organizers the tools and information needed to have a safe crowdfunding experience.
- Beneficiary Safety
-
It is important to use a crowdfunding platform that offers a beneficiary system where you can send the beneficiary a direct invitation to receive the funds, doing this will make supporters feel more comfortable because they will know exactly where their money are going.
Be sure to carefully review any investment crowdfunding site before committing your money to an investment offering. In the same way that looking at startup investments should involve some careful research into things like social media accounts and public database profiles, those same techniques can also be used to evaluate the platforms themselves.
If you are looking for a modern, uncomplicated, safe and hassle-free way to make your money grow, then Crowdfunding Place might be the investment solution you’ve been waiting for.
